First Time Home Buyer's Guide

Benefits of Home Ownership?

Pride of Home Ownership

Pride of home ownership is the number one
reason why Canadians desire their own home. There is no landlord looking over
your shoulder. You are able to make home improvements knowing that any
appreciation that results, will be to your benefit. Home ownership gives you
and your family a sense of stability and security. It's making an investment in
your future.

Appreciation

In Canada, especially in the last few
years, homes have appreciated considerably and in doing so have added
substantially to owners net worth. Unlike stocks and bonds, you get to live in
your real estate investment. Also, in Canada your principal residence is exempt
from capital gains taxes.

Mortgage Reduction Builds Equity

Each month, part of your monthly payment is
applied to the principal balance of your home loan, which builds your equity.
You can borrow against a home's equity for a variety of reasons such as home
improvement, sending your kids to university or college, or starting a new
business. Why pay-off your landlord’s property when you can own your own?

Homeowners accumulate wealth for the future
while enjoying the benefits of a shelter that they have can use, improve and
sell. Their home is a safe haven for investment.

Are You Ready to Buy a Home?

First – do you have the financial
resources? You should have five percent of the purchase price of a home for the
down payment, but ideally even more. Are there other priorities in your life
e.g. starting a new business, which require your savings? If not, buying a home
should be on your radar.

Second – do you expect to stay in your new
home for some time? Moving can be expensive and you will want to build some
equity before having to relocate. Your job and home life should be stable.

What Can You Afford?

If you haven't already gone through the
mortgage pre-qualification process, you will need to meet with a lender or
mortgage broker. They will establish how much of a mortgage you will qualify
for. Mortgage rates vary considerably and it is paramount that you shop around
for the best rate, terms and options.

Our Mortgage Calculator will help you
determine what monthly mortgage payment and the maximum mortgage you can
manage. Note: if you are buying a condo, the amount of your monthly assessment
has a direct impact on how much you can afford to spend on your mortgage.

First time homebuyers may want to take
advantage of the federal government’s Home Buyers’ Plan. Under this plan, you
may use up to $25,000 of your RRSP towards the purchase of a home. The money is
tax-free as long as you pay it back in the next 15 years. Ask your RE/MAX Sales
Associate for details.

Questions To Ask When Assessing Home Features

Do you need several bedrooms, more than one bathroom, space for a home office, a two-car garage?

Do you want air conditioning, storage or hobby space, a fireplace, a swimming pool? Do you have family members with special needs?

Do you plan to have children? Downtown or suburbs? Proximity to recreation or work.

Do you need a substantial backyard? Pets?

Is there adequate storage space?

Will any remodeling be required to make the home move-in ready for you?

What service providers (cable, Internet, telephone, Satelite) are available in the area, and is the house completely wired for each? Can you hear me now – how good is the cell phone reception?

How much are the yearly property taxes?

How much do utilities run each month? Does the house use gas or electric for the furnace, water heater, and appliances?

How old are the major appliances, and which are included with the house?

Have there been any major repairs to the house, and if so, when were they completed? For example, how old is the roof? Has water ever damaged the basement or foundation?

Ever had problems with insects, such as termites and spiders, or rodents?

Older homes need to be carefully examined - Windows may need caulking or new sashes, bathroom tiles may need grouting, home may need rewiring (planning on a hot tub or sauna?), a new hot water heater, or a new furnace.

Location, Location, Location

How far will you
be commuting and what is the traffic like? Factor in cost of fuel.

Where will your
children attend school and how will they commute?

Are there
recreational facilities and parks close by?

Are you close to
family and friends?

Is safety or high
crime an issue?

Is the property
close to an obstacle or negative influence? (i.e. an apartment building,
shopping centre, school, radio tower, power lines, LRT or railroad track,
highway, airport or commercial project).